DOUBLE TAX

Press, Volume XCVIII, Issue 29009, 25 September 1959, Page 12

DOUBLE TAX

Negotiations On Dividends (New Zealand Press Association) WELLINGTON, September 24. An agreement was in force with the United Kingdom for the avoidance of double taxation, and now negotiations were in train to secure some agreement on the question of payment of dividend tax, the Minister of Finance (Mr Nordmeyer) said in the House of Representatives this afternoon during committee stage discussion on the Land and Income Tax Amendment Bill.

He was replying to a matter raised by Mr B. V. Cooksley (Opposition, Wairarapa), who said that a young Wairarapa farmer who received income from his late father’s investments in the United Kingdom felt he was being unjustly treated because tax on that income had already been paid in the United Kingdom but the Department of Inland Revenue in New Zealand was warning him that that income was also liable for taxation here. “It’s so unjust he’s even thinking of giving it away,” said Mr Cooksley. Mr Nordmeyer said that New Zealand was well on the way toward securing a double taxation agreement with Australia, which was made possible only by the introduction in this country of the dividend tax. There was, an agreement on double taxation with the United Kingdom, but it was now desirable in the light of changed circumstances that there should be an agreement with that country covering cases where income was received in New Zealand from the United Kingdom. The principle should be that taxation should be paid in one country or the other, but not in both, continued the Minister. Naturally each Government wanted to get its full share. It was the New Zealand Government's sincere desire to see that taxation was not paid twice by any individual. If the income had paid tax in the United Kingdom, then the individual concerned should not have to pay it here. Mr Cooksley: Should not, or will not? Mr Nordmeyer: The honourable member will have to be satisfied with that.